We established sensitive and robust in vivo test systems to assess putative stem cells for their ability to differentiate into cells capable of physiologically regulated insulin secretion. Using our mouse experimental autoimmune diabetes (EAD) model system, we have designed an in vivo assay to test if stem cells can efficiently generate and maintain beta cells during an ongoing autoimmune response. Specific features of the model include: (i) normal host metabolism is maintained for an extended time followed by (ii) gradually declining pancreatic islet function creating a need for new beta cells, (iii) intra-islet inflammation which may provide critical cues for regulated stem cell migration to the pancreas and differentiation into beta cells, and (iv) newly developed, stem cell-derived beta cells are resistant to autoantigen-specific T cell mediated attack. Using this system, we tested crude preparations of hematopoetic stem cells (HSC) reported by some to contain cells capable of transdifferentiating into pancreatic beta cells. We found that the HSC had no functionally relevant capacity to form beta cells in vivo. Using the model, we thoroughly evaluated and experimentally ruled out several critical questions such as whether the failure to generate insulin producing beta cells in vivo might have been due to the inability of newly developed beta cells to withstand the toxicity of an inflammatory environment typically associated with immune-mediated pancreatic islet destruction. Data weve generated strongly support the claim that newly generated beta cells from the bone marrow donor origin would be protected from immune mediated attack, by confirming the selective survival of donor-derived pancreatic islets (stem-cell genotype) over host-type islets during rejection of mixed islet transplants. As a positive control for this model, we've shown that single cells isolated from embryonic mouse pancreata, then injected into the adult mouse pancreas, will differentiate into mature islets. More specifically, using mice provided by Dr. Manami Hari (University of Chicago) in which beta cell expression of green fluorescent protein is driven by the mouse insulin promoter, weve shown that a single cell suspension of day e14.5 pancreatic bud cells can be injected into the pancreas of adult syngeneic mice and that committed progenitor cells from the embryonic mouse pancreas will differentiate in the adult mouse pancreas into mature appearing islets. Moreover, the islets differentiating from the embryonic donors are clearly differentiated by their green color. These data are being submitted for publication. In related work, Dr. Pechhold demonstrated with collaborators using cell labeling techniques that islet beta cells do not efficiently de-differentiate into rapidly proliferating cells (so called epithelial to mesenchymal transition) that can then be re-differentiated into insulin producing cells in vitro.[unreadable] [unreadable] In work from last year, we demonstrated that a gene-therapy approach described by others as efficiently promoting transdifferentiation, i.e. converting liver cells into insulin producing cells, was in fact very inefficient. Our published studies suggested that mouse liver Pdx-1 expression driven by adenoviral vectors generated less hepatic insulin production than 16 islets, an amount clearly insufficient to maintain glucose homeostasis.